ISLAM: Australia set to accommodate Islamic sharia finance

by Bill Muehlenberg

News Weekly, June 26, 2010

All over the Western world, governments are bending over backwards to accommodate sharia finance. This is an interest-free banking and finance system which Muslims want to have run as a parallel economic stream in Western nations.

The United Kingdom leads the world in this practice, and now Australia and other nations are seeking to get their share of the action.

Consider a speech made by Australian Assistant Treasurer, Senator Nick Sherry, on April 27 in Doha, Qatar. He told his Muslim audience how keen Australia was to embrace sharia finance.

He said: "On 15 January this year, the Government released the final report of this process, known as the Australia as a Financial Centre (or the Johnson Report). The report concluded that Australia has arguably the most efficient and competitive financial sector in the Asia-Pacific region, but there are further opportunities to expand our exports and imports of financial services.

"And it made a range of important recommendations, including specific steps to ensure Islamic finance is enabled in Australia. And that's exactly what I now want to address. The competitiveness of Australia's financial services sector offers great opportunities for Islamic banks and financial institutions to do business in our country, or to export their products to Asia from a strong, stable and extremely well regulated regional base.

"It, of course, also presents opportunities for Australian-based banks and financial institutions to develop Islamic or Shariah-compliant finance products for domestic and international markets. Australia is well aware of the potential for Islamic finance in developing our nation as a financial services centre. The Financial Centre report I just mentioned includes two specific recommendations on Islamic finance.

"First, the report recommends the removal of regulatory barriers to the development of Islamic finance products in Australia. Secondly, the report calls for an inquiry by the Board of Taxation into whether Australian tax law needs to be amended to ensure that Islamic financial products have parity of treatment with conventional products.

"It is with great pleasure I can confirm today, here in Qatar, that as the first major instalment in the Government's response to this landmark report, I have directed the Board of Taxation to undertake a comprehensive review of Australia's tax laws to ensure that, wherever possible, they do not inhibit the expansion of Islamic finance, banking and insurance products.

"Australia's decision means we will be among the first OECD countries to conduct this kind of system-wide review and it will mean we are among the very first to get all the tax settings right. I know the United Kingdom has acted on a few discrete areas, but the review I am announcing is thoroughly comprehensive.

"Islamic finance is a rapidly growing part of the global financial system and Australia is in an excellent position to capitalise on that growth, but we have to ensure our tax system doesn't unnecessarily prevent that from happening. Today's announcement is a major step in ensuring that we get the settings right."

Australia, like other Western nations, wants to gain financially from such moves, but it seems unaware that it is in fact cutting its own throat. Sharia-compliant finance is simply part of the wider move to set up sharia law in the West, which in turn is part of the larger goal of global Islamic domination.

Indeed, the push for sharia finance is a fairly recent development of the Islamic community, primarily promoted by radical Islamists. As former Muslim Patrick Sookhdeo says in his important book, Understanding Sharia Finance (Isaac Publishing, 2008), it was a militant Pakistani Islamist who initiated this drive.

Says Sookhdeo: "The concept of an Islamic economy was integrated into the discourse of the Islamist struggle to weaken the West in preparation for the ultimate phase of establishing Muslim political hegemony in the world."

A separate Islamic economic system in Western nations is part of the push for a separate political and legal system. Committed Muslims see sharia law as the only true law, and consider Western, non-Islamic laws to be heretical - hence the push for separate spheres of Islamic sovereignty.

Two-tiered system

Of course, no nation can survive long with a two-tiered legal system, financial system, and so on. If immigrants seeking to come to Australia refuse to integrate into the Australian way of life, including its economic and financial system, then social cohesion is doomed from the start.

However, many Muslims coming to the West have made it clear they do not intend to integrate with the host nation, but to set up separate Islamic enclaves within it. And as the number of Muslims increases, the final goal of the complete Islamisation of society can take place.

As Sookhdeo notes, "Islamic economics became an efficient weapon in the hands of Islamists planning for Islam's domination of the world-system in all fields: political, military, economic and cultural. For them, the establishment of a worldwide universal Islamic state under sharia is God's command to Muslims of all generations and the real aim of jihad."

Speaking of jihad, one should add that another major concern is how Islamic banking and finance are a major means of funding international Islamic terrorism. Islamists seek to redistribute wealth in sharia finance based on the zakat, the obligatory donation all Muslims are supposed to pay.

This 2.5 per cent tax is in effect a type of income tax, and, according to traditional Islamic teaching, the zakat is to be used in the funding of jihad. Says Sookhdeo: "According to Qur'an and sunna, God commands Muslims to devote their wealth and their lives to jihad."

He explains that sharia finance "is part of a wider agenda of jihad, in accordance with the vision of Islamist ideologists of the overthrow of non-Islamic systems and the establishment of a pan-Islamic Caliphate that will rule the earth".

He offers this sober warning: "Western governments and institutions now gladly cashing in on the Islamic market are falling into the same trap into which Western governments fell when they supported Islamist radicals in fighting the Soviet Union. They are supporting the rise of a powerful system they cannot control and that might turn against them."

In the very same way, Western governments last century were happy to prop up communist dictatorships which were dedicated to overthrowing the West. Lenin once quipped that "the capitalists will sell us the rope with which we will hang them".

That is happening again today. A new enemy of the free West has arisen, and foolish, naïve and short-sighted Western leaders are more than happy to aid and abet the Islamists as they seek the ultimate overthrow of all non-Islamic nations.

Bill Muehlenberg is a commentator on contemporary issues, and lectures on ethics and philosophy. His website CultureWatch is at: www.billmuehlenberg.com